Radio station Cadena SER reports that the 21-year-old is a target for Arsenal manager Arsene Wenger.
Valencia, Villarreal and several other major clubs across Europe are also interested in the highly-rated midfielder.
Baena’s contract with Espanyol is set to expire in the summer of 2013.
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Liverpool have unveiled their new home kit for next season, sticking with the hugely popular retro styling of the current shirt.
The reputation of the Premier League means it is the most popular and one of the most watched leagues in the world.